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New car market stable in July

New car registrations were stable in July, with private sales almost exactly the same as 12 months ago and fleet registrations showing a small increase in the latest numbers published today by the Society of Motor Manufacturers and Traders (SMMT).

The overall market was up just over 1% on the same month last year, with just under 164,000 new cars registered. Of those, private buyers accounted for 41% of the total, with almost exactly the same number of private new car sales as July 2017. Fleet sales were up by 2.6%, a small but welcome increase for manufacturers.

There was continued stability in the different fuel types of all those new cars. Diesel sales made up 32% of the total, which is still a 24% drop on last year but pretty consistent over the last five months or so. We’ve continually predicted that diesel’s market share should settle at around the 30% mark, and this is currently proving to be the case.

Alternatively-fuelled vehicles (basically hybrids and fully-electric vehicles) continue to grow, with a second consecutive month above 6%. Plug-in hybrid models saw particular growth of more than 33%, ahead of ‘regular’ hybrids at 17% growth and full-electric models up 2%. It’s still small beer in overall terms, but progress nevertheless. As more and more electrified models continue to become available, this will inevitably keep growing.

July 2018 new car registrations
Swings still look dramatic compared to last year, but pretty stable over the last few months

The next few months will hopefully see continued stability, despite the Bank of England announcing an increase in official interest rates last week. A similar increase last November made absolutely no difference to the levels of borrowing on car finance, and we see no reason why this latest increase will make a significant difference either. Some finance companies may have to trim their profit margins slightly to close a few borderline deals, but there’s no need to feel too sorry for them.

There may some supply issues for some brands as WLTP fuel economy standards come into effect from September, which may lead to a bit of volatility within the marketplace over the next couple of months. This may affect relative sales among manufacturers but shouldn’t significantly affect overall registration numbers.

August will, as usual, be very quiet in terms of new car sales thanks to the UK’s ridiculous registration system, but manufacturers will be hoping for a decent September this year after a disappointing time last year.

Top ten shuffling

The top ten best-seller list saw a bit of a shake-up in July, with smaller cars enjoying another good month. As usual, the Ford Fiesta reigned supreme at the top ahead of the Volkswagen Golf. After that, the Volkswagen Polo and Vauxhall Corsa enjoyed strong sales to occupy the third and fourth places. The Audi A3 and Mercedes-Benz A-Class both bounced back into the top ten in July to sit sixth and seventh, while the Ford Kuga reappeared in eighth place and the Kia Sportage popped up in tenth.

These came at the expense of the Ford Focus, Mini hatch and BMW 1 Series and 3 Series models, which all fell out of the top ten. The Focus is very much in run-out mode ahead of the all-new model arriving in showrooms, which has allowed the Nissan Qashqai to overtake it for third place in total year-to-date sales.

Notably, there were no dedicated saloon or estate models in the top ten (apart from the small number of Audi A3 saloons that are sold relative to the hatchback versions), with six hatchback models and four SUV/crossovers instead.

July 2018 new car top ten
Good month for Volkswagen, not so much for BMW who had two models in the top ten last month

 

Stuart Masson
Stuart Massonhttps://www.thecarexpert.co.uk/
Stuart is the Editorial Director of our suite of sites: The Car Expert, The Van Expert and The Truck Expert. Originally from Australia, Stuart has had a passion for cars and the automotive industry for over thirty years. He spent a decade in automotive retail, and now works tirelessly to help car buyers by providing independent and impartial advice.

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